Procurement must understand marketing 'or you can't help us'

Procurement needs to get over the stereotypes around marketing and understand what the department does, the chief customer officer at Ladbrokes Coral has said.

Kristof Fahy, who was chief marketing officer at Ladbrokes before its merger with Coral, said procurement needed to embed itself into marketing departments to better understand the work it does and align its objectives and KPIs.

“Here’s how the conversation goes,” said Fahy, outlining a discussion he said is common. Procurement approaches marketing and says it wants to be part of the search for a new agency, but it has no experience in the market. “‘We just really want to get involved, and by the way, we have to because we report to the CFO and if we don’t agree it’s not going to happen’,” Fahy said.

“That’s not really going to work for me,” he said.

Speaking at Procurecon Marketing conference in London yesterday, Fahy said buyers need to overcome these issues by embedding themselves into their marketing department and by addressing the stereotypes around the function. “Marketing is about delivering future cash flow. It’s the key commercial driver for any business. It is not the picture department, it is not the crayon department, it is not – as someone once called it – the balloons and T-shirt department.”

“Go to all their team meetings so you actually understand what’s happening day to day, month to month, year by year,” said Fahy. Procurement needs to know what the department does strategically and operationally, “and unless you really understand that, you can’t help us”.

Open conversations between the two departments are also needed, and Fahy recommends rating each other after every project. “Let’s have a proper rating system because actually the openness and transparency we’ll have will be really, really effective and we can have some difficult discussions.”

Fahy said he wants procurement to be proactive around issues of market visibility, the impact agency partners are having and their transparency. The agency market has thousands of suppliers, he said. “I can’t navigate this on my own, and yet I’ve probably had an email from nearly every one of these people saying, ‘Hey, we’ve got the best solution known to man’.”

“Help me navigate that madness of suppliers out there that can solve all our problems and maybe, maybe I’ll start a very, very, very small procurement fan club.”